>> eric: if i did -- >> isn't that what romney bet? >> bob: yes, i don't have enelevator in my garage. >> greg: you have an elevator in your bedroom. >> kimberly: he is here all week. that is it for "the five." thank you for watching. see you here tomorrow. president obama challenges critic of the terror attack to "go after me," not u.n. ambassador susan rice. this is "special report." ♪ >> chris: good evening. i'm chris wallace in for bret baier. president obama held his first news conference in eight months today. and the first question was not about the fiscal cliff, or the terror attack in libya. no. it was about the scandal involving two top officials, two women who are not their wives an whether there was a breach of national security. we have fox team coverage.

national security correspondent jennifer griffin looks at whether the mistress of the former c.i.a. director had classified information on her home computer. chief intelligence correspondent catherine herridge tells us how some republican lawmakers are invoking washington's most famous scandal ever. but we begin with chief white house correspondent ed henry on the libya attack and who should get the blame. good evening. >> good evening, chris. temperature was raised today as the republicans said they want watergate style hearings in to benghazi. the president fired back saying if you want to blame someone, blame me, not my staff. when i pressed him today at the news conference what he did to save lives the president did not want to get into details. his first full news conference at the white house in eight months, president obama raced to the defense of his u.n. ambassador susan rice. republicans vowed to block her from becoming the next secretary of state. >> for them to go after the-up ambassador, who had nothing to do with benghazi and simply

making a presentation based on intelligence she had received and to besmirch her reputation is outrageous. >> five days after the terror attack in libya, rice went on five sunday talk shows to say the early intelligence suggested that the assault was a spontaneous reaction to an anti-muslim video. >> who in the white house, who was president of the united states, was it one of his people? who was it that gave her talking points that clearly indicateed something for which there was no basis if facts? >> reporter: earlier today, republican senator john mccain joined lindsey graham and kelly ayotte vowing to stop rice's potential nomination as secretary of state. while the president would not speculate about his choice to replace outgoing secretary hillary clinton, he reacted angrily to the republican charges and dug in hard enough to suggest he may name rice. >> she made an appearance at the request of the white house. in which she gave her best understanding of the

intelligence that had been provided to her. if senator mccain and senator graham a others want to go after somebody, they should go after me. i'm happy to have that discussion with them. >> reporter: when pressed by fox news in his own role reacting to the terror attack the president did not directly answer questions raised by some relatives of the four americans killed in bening about whether he did enough to save their lives. >> i would like for you to address the families, if you can, on 9/11 as commander-in-chief. did you issue any orders to try to protect their lives? >> ed, i will address the families not through the press. i'll address the families directly. as i already have. we will provide information available about what happened on that day. >> on the question whether he personally issued any orders that night, the president gave a general response about

reaction from the state department and other agencies. >> their number one priority is protect american lives. that's what their job is. i can tell you immediately upon finding out that our folks were in danger, my ordinaries were do whatever we need to do to keep them safe. >> this president or administration has either been guilty of colossal incatch tense or engaged in a coverum -- incompetence or engamed in a coverup, neither are acceptable for the american people. >> they pushed back noting on 5:00 p.m. on september 11, president ordered defense officials to move military assets in place as quickly as possible that resulted in four military teams dispatched but they were not close enough to libya to get there in time. chris? >> chris: ed henry reporting from the white house. ed, thanks for that. no word evokes fear and dread in washington like "watergate." but some on capitol hill are

using that word in their call for special hearings on the benghazi attack. chief intelligence correspondent catherine herridge has the latest. >> reporter: some republicans are saying deaths in benghazi are on scale with the same controversies in history. >> watergat and iran can tra benefited from a select committee. finding the truth about benghazi is only possible if you combine resources of the three committees and do in a professional manner. >> reporter: the republican proposal would bring together the senate intelligence armed services and foreign relations committee as the investigation now has at least three lines of inquiry. question of culpability of secretary clinton a her department. >> we know there were cables request made from the state department officials asking for enhanced security. and so, that is why you can see where this investigation has to be looked at in a

complete fashion rather than stove pipe. >> there are the administration's statements that the benghazi terror attack was a demonstration against the anti-islam video that spun out of control. an explanation given by susan rice which conflicted with raw intelligence reporting. >> why did you pick her to tell us about benghazi? she is the united nations ambassador. >> how some lawmakers openly question whether the c.i.a. director knew he was the suggest of an f.b.i. investigation when he briefed capitol hill. >> on september 14, lawmakers say petraeus seemed wedded to the administration's explanation. >> it's impossible to believe that he thought he was giving us honest assessment. >> leading critic of the obama administration to benghazi tetchered expectation. >> the power in power never likes a select committee but i am hope that the american people will demand it. and i am guardedly optimistic that they will achieve that goal. >> as he walked away from a mid-day news conference senate

majority leader harry reid told reporters he would in out support the idea that chair and ranking members of the senate homeland security committee who have their own investigation said the proposal was premature. >> i do not see the benefit nor the need for a select committee. >> in closed briefings today, fox news told the f.b.i. deputy director and his boss robert mueller face hard questions about the f.b.i. petraeus investigation. the acting director of the c.i.a. fielding questions about the attack. >> thursday, the nation's senior intelligence and lawmaker officials will testify in classified session to house intelligence committee that is closed to the public and reporters. fox news learned former c.i.a. director david petraeus voluntarily agreed to testify before both committees. while there are reports that the testimony could come as early as tomorrow, it remains fluid situation. and nothing has been finalized tonight, chris. >> chris: we'll stay on top of it. thank you. now to what investigators found in paula broadwell's

home computer. here is national security correspondent jennifer griffin. >> as a military intelligence army reserve lieutenant can no paula broadwell has special clearance to view classified information but not to take it home with her. in addition, she could face charms under the uniform code of military justice if she was working for army at the time of her extra marital affair with david petraeus. the army is currently investigating. f.b.i. returned to her home in north carolina monday night and carted away computers and half a dozen boxes of documents we have since learned contain classified information. the f.b.i. has said there is no indication petraeus gave broadwell those documents. the president cited an ongoing investigation. >> i have no evidence at this point, from what i have seen, that classified information was disclosed, that in any way would have had a negative impact on the national security. >> the president was asked whether he thinks the f.b.i.

should have told him sooner about the petraeus investigation. >> it is also possible had we been told, then you would be sitting here asking a question about why were you interfering in a criminal investigation? >> not so says author of books on the f.b.i. and c.i.a. ros ron kessler. >> every week mueller meets with himmed on that matter of criminal investigation. terrorism, espyianage and high level of the administration. >> you want the president to know evening he needs to know to evaluate intelligence to protect the country. if his chief intelligence director is vulnerable or exercised poor judgment, and

is suspect, that is something to ask. >> more questions are asked about petraeus' relationship to two lebanese american sisters in tampa, florida. jill kelley and her sister natalie both appear to have accumulated mountains of debt, up to $3 million in the case of jill kelley. both cultivated relationships with powerful men in washington. and four-star generals serving in florida. in september, petraeus backed natalie in a bitter custody dispute with a former bush administration official involved in iraq reconstruction deals. the u.s. military suspended jill kelley's base pass to central command in recent days and army suspended paula broadwell's security clearance as a result of the ongoing investigation. we just received a statement from the military lawyer for general allen who said the general will comply with the

ongoing investigation by the inspector general. >> chris: jennifer griffin reporting from the pentagon. thanks. the air force is changing how it selects those responsible for training recruits following a sex scandal in which dozen of women say they were improperly approached, sexually harassed or rapeed. an investigating officer said bad instructors took advantage of a weak oversight system where the supervisors did not adequately take a look at them. david petraeus shows up at another place you would not expect to find him. that is later on the grapevine. straight ahead, president obama vows to stick to his ginguns, this time on taxes. ye. [ thinking ] woer what other questionable choices i've made? i choose date number 2! whooo! [ sigh of relf ] [ male announcer ] choose taste. choose prego.

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>> chris: if the petraeus scandal in libya were two of the top issues in the president's news conference, the looming fiscal cliff was the other big subject. president obama said he would look at reforming entitlements

and stand firm on his promise to increase tax rates for high earners. chief congressional correspondent mike emanuel tonight on the prospects for some kind of compromise. >> with the u.s. economy due to hit the fiscal cliff, trillion of tax increases and spending cuts, president obama called for a catch henceive deal and said he is not going to one on the top 2%. >> we cannot afford to extend the bush tax cuts for the wealthy. we can make sure that middle class taxes don't go up. if we get that in place we are removing half of the fiscal cliff. >> speaker john boehner offered what he considers a balanced approach generating the revenue from tax reform and entitlement reform. late today, boehner said the president's position is flawed. >> we are not going to hurt our economy an make job creation more difficult. which is exactly what that plan would do. >> letter sent by the u.s. chamber of commerce and signed by 232 organizations

calls on the president and congress to immediately extend all the tax cuts and find other cuts to replace sequestration. the president suggested taking a closer look at reforming entitlements without offing details and says he would like to simplify the tax code. mr. obama says he wants congress to act now to extend tax cut for middle class and try to avoid boxing himself in on upcoming negotiation. >> i'm open to come plo mize and new ideas. i have been encouraged for republicans to agree to more revenue as part of the arithmetic if we are serious to reduce deficit. >> the top republican in senate who is a key player in upcoming talks says raising taxes on the upper income americans does not add up.

>> you can't raise taxes enough. the argument on whether or not we should raise tax rates on people above $250,000 would have produced enough revenue to fund the government for six days. >> late in day mcconnell said it's the president's turn to have a detailed plan to include entitlement reform and could win support of both parties to have a chance of becoming law. >> wholesale prices dipped for their first decline since may. wall street did not take the news well. dow lost 185. s&p 500 dropped 19. nasdaq fell 37. many european say they reached the breaking point with evidents to deal with the continent's economic woes. senior foreign affairs correspondent ammy kellogg reports from london. much of the frustration took

to the streets today. >> it was europe's first pan continental day of action with strikers saying enough is enough. arguing that the austerity cuts are crippling and not helping. >> it's just a terrible situation. only cuts, cuts, cuts. >> tear gas rained down, so did a bar ran of discouraging numbers. factory fell to steepest days in years and even in the powerhouse country of germany. greece's economic output shrunk by 7.2% in third quarter though terrorism was up. youth unemployment is at 58%. bank of england scaled down the projection of growth in the u.k. for 2013 to just 1%. people are seething about cuts to education. medical care. mentions and welfare payments. the continent simply cannot sustain spending anymore. some say the implosion of the european social safety system with the fierce labor protection is a lesson for all. >> when so many generations of

people become so dependent on services and the jobs that the labor regulations protect, then they begin to feel they have an entitlement to them. a right. if they feel the rights are takeen away they will riot and protest. >> european countrys watch in fear to see what happens with the u.s. fiscal cliff. as america reels from the drop in demand for exports to europe. a very important market. chris? >> chris: amy kellogg from london. thank you for that. still ahead israel takes out with of the top targets. but first, the man many blame for deadly meningitis outbreak takes the fifth. lists all done. raise the roof! no one says th anymore, mom. [ woman ] raise the roof! ah? raise the roof!

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>> chris: lawmakers did not get much information from the man who runs the company tied to the meningitis outbreak that killed 32 people. correspondent jonathan serrie tells us he was asked a number of key questions but he wouldn't answer. >> i decline to answer. >> on advice of counsel i decline to answer. >> barry, the coowner of the massachusetts pharmacy implicated in the deadly meningitis outbreak refused to testify despite repeated questions from a congressional panel. >> what do you say to all of these patients and all of the families that have been devastated by the contaminated products that your company produced? >> i respectfully decline to answer on the basis of my constitutional rights and privileges. >> the panel did hear from the widow of kentucky circuit court judge edy lovelace who died after receiving injection of back pain medication produced by the new england

compounding center. >> whoever is responsible, i want them to know their lack of attention to the duties cost my husband his life. >> as a compounding pharmacy, any cc does not same federal oversight as the drug manufacturers. members of congress are trying to determine whether regulators dropped the ball or whether their hands were tied by what the fda commissioner described as a crazy quilt of legal authority. >> what we do know that s that stronger clearer authority would enable more effective regulation of the drug compounding industry. especially when it has been evolved so significantly. >> massachusetts officials say necc when beyond the scope as a pharmacy and beheyed more like a drug manufacturer. producing mass quantity of medication for interstate sale. congress is likely to debate whether this an isolated case handled by the courts or additional legislation is needed to beef up the federal government oversight of compounding pharmacies.

chris? >> chris: jonathan, thank you. the head of the long island power authority is resigning after coming under intense criticism for the utility response to hurricane sandy. michael herve leighs at the end of the year. lipa still not restored power to 10,000 customers of the 1 million who lost electricity two weeks ago. three pilots flying to an faa safety conference were killed tuesday when their airplane crashed in a house shortly after take-off. it happened near hawkins field airport in jackson, mississippi. a police officer says the plane sputtered like it was out of fuel and then went down. the plane's owner who was supposed to be on the flight decided to go hunting instead. well, a bit of irony surrounding david petraeus and a they mous famous video game. people in all 50 states now want to leave the united states. grapevine is next. aren't getting shorter.

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>> chris: now, fresh pickings from the political grapevine. the movement to secede from the united states picked up steam in the 24 hours since we first told you about it. the daily caller reports the white house received more than 675,000 signatures across all 50 states. there are now seven states -- alabama, florida, georgia, louisiana, north carolina, tennessee, texas -- which have the 25,000 signatures necessary for the white house to review their proposals.

web surfers must register with the white house before launching or signing a petition to vote only once in each state. while reporters focus on the extra marital affair and tappaled coverup, video -- tangled coverup, video gamers play out a fantasy where david petraeus is defense secretary. atlantic reports the new "call of duty" game is set in the year 2025 with a hillary clintonesque female president. the news of the scandal followed by game's release tuesday made for interesting timing. a gaming blog notes, "all of this adds up to an incredibly awkward coincidence an unintended comedy for the otherwise ultra serious tom clancy style military fantasy that is black ops 2." finally, the country's fiscal picture has spooked a montana lawmaker to make unusual request. montana state representative jerry o'neil wants his pay in

silver and gold coins. o'neil cites article 1, section 10 of the u.s. constitution which says no state shall "make anything but gold and silver coin, a tender in payment of debts." no word whether the state of montana will comply with his request. egypt has recalled the ambassador to israel following the killing of a top hamas leader. the palestinian authority isialing the u.n. to condemn what it calls illegal criminal actions. israel says it's just defending itself and will do it again if necessary. leland vittert reports from jerusalem. >> from an israeli drone you can see the car of hamas' military commander driving along a quiet street in gaza city. the missile appeared to come out of nowhere. he didn't have a chance. his car burped to a shell. within hours the israeli air strike killed two more senior hamas militants and destroyed

major weapon store ran facility. the assassination marked the start of operation pillar of cloud against hamas and islamic jihad in response to a week of militant rockets launched in southern israel. and the missile attack of an army jeep as shown in this video provided by the attacke attackers. at a press conference israel's prime minister promised "anything needed to defend our citizens." he continued we are ready to bring in more forces if needed. alluding to a ground defense that similar to 2008 when israel sent the tanks farce bloody month long street to street battle against the hamas fighters. in gaza, the killing stunned hamas. both with demonstration of israel real-time intelligence and the resumption of targeted killings. god willing, said this hamas official, the zionist enemy will pay a price. within hours the retaliation began with rockets fired at

israel's largest southern city. so far, the iron dome defense system has intercepted many of the incoming rounds but the protection is far from absolute. hamas says that israel "opened the gates of hell" with their attacks but the strike may have crippled the main trump card. rockets that can fly from here on the gaza strip up to tel aviv. tonight, the sound of f-16 fighter jets in the air as they continue to bomb gaza. it's 1:30 in the morning now. in 12 hours, hamas will bury their dead and we'll know if they decide to call at it day or the salvos are the opening of another war. chris? >> chris: leland vittert reporting from the israel-gaza border. thanks for that. israel's defense minister says syrian rebels control nearly all villages near the boarder with the golan heights.

rebels along the boarder with turkey are being bombarded by the government aircraft and artillery. opposition forces see as much of the region last week. the president weighs in on the petraeus scandal and the benghazi investigation. we will hear about both from the panel when we come right back. [ male announcer ] you are a business pro. governor of getting it done. you know how to dance... with a deadline. and you...rent from national. because only national lets you choose any car in the aisle... and go. you can even take a full-size or above, and still pay the mid-size price. this is awesome. [ male announcer ] yes, it is, business pro. yes, it is. go national. go like a pro.

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♪ so make them write a big check today. ♪ ♪ and if you're feeling a little slow, ♪ ♪ then 5-hour energy will help you go. ♪ ♪ so buy a bottle of pink lemonade and ♪ ♪ you can help fight breast cancer today. ♪ if people don't think that we did evening we can to make sure that we saved lives of folks who i sent there and who were carrying out missions on behalf of the united states then you don't know how our defense department thinks or our state department thinks, or our c.i.a. thinks. their number one priority is protect american lives. that is what our job is. >> chris: president obama and his first news conference sanction answering a question whether he gave any orders on the night of the benghazi

attack to protect the americans on the ground there. time to bring in our panel. fred barnes of the "the weekly standard." stoddard of the hill newspaper -- a.b. stoddard of the hill. >> charles lane from the "washington post." tonight, let me check, from atlanta, yes, syndicated columnist charles krauthammer. charles, how is your manual call mystery tour going? >> i'm out here going city to city and rooting out harassries among conservatives. >> chris: i hope you are making money you will need it to pay higher tax rates. >> and the lawyers, too. >> chris: there you go. start with benghazi. the president was asked -- he wasn't asked much about it today. but asked at the event on the night of the attack he said i told officials to do everything they could to protect the americans. fred barnes how does it move the story forward or not? >> for one thing it moves it a little. he was immediately involved. this was a 7-hour episode in

benghazi. the attack on the consulate and the c.i.a. annex. it leads to another question. the question is well, you ordered this. why was so little done in why did nobody go there to rescue the ambassador or to rescue the people at the c.i.a. annex? why was so little done? he certainly didn't answer that. i thought when he got to the question of susan rice as well -- >> chris: we'll get to that in a minute. >> anyway, he raised another question there. >> you will get a swing at that. let me push back on this, a.b. leon panetta, at a news conference at pentagon several week ago said we knew about this. we had forces in the area. but the decision of general dempsey, head of joint chief, myself, general ham was that we coulden in the the time involved there move forces to the area. >> there have been conflicting accounts on what happened and whether or not the request was made, whether it was turned down. he says today for the first time my orders were.

i don't know that he said he was doing that night and what transpired in those seven hours. in terms of what was -- >> we did know he met because they were already there for a meeting. meeting with top officials. >> but he has not explained how the hours unfolded. what you see right now is a focus on capitol hill on david petraeus. they are hoping for a lot of clarification from his testimony. i think what you also see because, you know, there was no reporter asking today could you walk up through the seven hours on september 11? you will see a lot of heat on hillary clinton. she is not here for the hearings now but there will be an attempt to get her to sit down and explain whether it's open or closed session. we know what transpired and to talk about the president's role. that is something i think will happen no matter what david petraeus does tomorrow. >> chris: i think it's fair to say that in an almost hour news conference the president showed his greatest passion on any issue when he was asked about u.n. ambassador susan

rice and comments by some top republican senators that they are going to do everything they can to block her possible, possible nomination to secretary of state to replace hillary clinton, because of what she said on the sunday talk shows, which they say was misleading. they imply intentionally misleading. let's take a look at how the president responded to that. >> when they go after the u.n. ambassador, apparently because they think she is an easy target. then they have a problem with me. an should i choose if i think that she would be the best person to serve america, in the capacity, the state department thenly nominate her. >> chris: it was very interesting, charles lane. he went out of his way. i mean he didn't say i will name her. obviously, he is not about to in this situation say who is going to replace hillary clinton. burr he went out of his way to say i don't care what the guys

say. if i want to name her, i will name her. >> little political theater there. chivalrous president. he is warning them not to imagine they can play to the base going after susan rice and turning a potential nomination of her to that job to a big who-ha in the senate and confirmation hearings because in his view he has the wind at his back politically and can get her nomination through. >> chris: charles krauthammer, let me bring you in to this. what is your reaction to the president's comment about susan rice? in his defense he said we asked her to go out and she was reciting the intelligence talking points that she was given. >> you called at it show of passion. i would say it was the usual

show of indignation. his default response when he feels defensive or backe backeda corner. how dare you attack my u.n. ambassador. and then he gives the strange jest defense by saying she didn't have anything to do with the benghazi attack. then why are you sending her out there? why didn't you send out the secretary of state or the c.i.a. director or panetta or somebody, who did know? then he does play the sort of lalancelot defending the women. made romney with binders with women feminist in comparison, patronizing attack on two male senators who would dare attack the girl, which was intended in his tone. this is all the usual, you know, if you attack the pride, he will strike you on that. it was clearly defensive. it was also a stonewall.

after all, what she said was absolutely and completely misleading. either inadvertently where it's complete incompetence or on purpose, in which case it's deception. then he basically, he took bait on that and said look, that wasn't her speaking. that was me speaking. if you want to pick on somebody, pick on me. how can anybody mcon him or even question him, if he hasn't had a press conference in eight months? you know, he clearly hasn't been out there. he's been hiding behind inquiries, behind investigations. and now behind susan rice. but now i think he is out there. and he is vulnerable on this. i think he may rebret having said that. >> let me pick up on the other interesting delopment. senator mccain, graham, ayotte said they believe there should be a special watergate tile commission or independent commission to investigate benghazi. one, is it a good idea? two, what are the chances it

will happen? >> one, it is a good idea. two, the chances don't look good. harry reid said no and senior republicans on the armed forces or one of the other committees that is doing the own hearings said no. >> chris: national security. >> so we're not there yet. i would say -- i did want to say something about susan rice, though. the president said he sent her out to give a presentation. is that what she did here? on "fox news sunday." i assumed she was asked questions. give a presentation. here is the-up ambassador and he said she gives testimony that turned out not to be true or said things. besmirches her reputation when you channel that? ridiculous on his part. >> chris: all right. we'll leigh it there. more to follow. take a break here. but up next the president addresses the looming fiscal cliff. years ago, my doctor told me

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when it comes to the top 2%, what i'm not going to do is to extend further a tax cut for folks who don't need it, which would cost close to $1 trillion. it's very difficult to see how you make up that trillion dollars if we are serious about deficit reduction, just by closing loopholes and deductions. >> chris: president obama pushing back today against republican claims that washington can raise enough revenue without raising tax rates. we are back with the panel. a.b., the president did make it clear today that he is not going to extend the bush tax cuts. he said, as you heard there, that the tax reform, closing loopholes doesn't get you enough re-knew.

so given -- revenue. given the fact he is saying i am going to raise rates about the republicans are saying we don't want to see the rates raised where does it leave negotiations over the fiscal cliff? >> the negotiations haven't begun and they won't begin in earnest until after thig. there is a lot of speaking to the microphones. inside game and outside game that both parties are playing. obama inside game is telling labor and friends on the left he is not going to one and assuring them he will fight the big fight. at the same time, what i heard in the press conference in another statement was actually popeness to create i ways of producing more revenue that he is open and not going to close down discussions as long as they end up taxing the wealthy. and the middle class don't get hit. so he is trying to not double down on rates as the republicans are running around saying we can't raise rates. i do believe that there is some willingness for him to be open as long as he is longing at a good enough number and good enough source of re-knew from the wealthy.

that being said, we are looking at a huge fight because the republicans are really torn up about this. what is an increase in tax mean, what do increased re-knews mean? i don't think we will know until december whether or not they will offer up the deductions and evening he is looking for. >> chris: charles, we have big headlines in paper saying now that the president isn't willing, or isn't demanding $800 billion which is what back in august of 2011 he had big debt talks with the john boehner, he wants double that. he wants $1.6 trillion in re-knew increases -- revenue increases. again, you know, he has an election. and he sounds like he is going to try to push what he sees as the advantage with the republicans. >> he is not going to get $1.6 trillion. that is opening bid. but you are right, he holds the cards now, all the cards. because the fiscal cliff, the way it changes policy, in a

liberal direction. raises tax rate and cuts defense. in a way he wins if we go over the cliff. trump card is a low standing of the republican congress in political opinion. there is a new poll out. you guys showed it earlier. "washington post" pew poll. if we go over the fiscal cliff we will blame republicans. really, obama, the ball is in the republican's court. they may not like that. i think that is the truth. obama is in the driver's seat. >> chris: charles krauthammer i would love for you to react to that. he wants a big deal and comprehensive deal. i thought quite open about the idea he was willing to put entitlement and reform on the table. >> we said in the past he never proposed anything. perhaps he will do it.

i don't know. i disagree with what check said about obama hamming the cards. obama is not running again. it's not going to help him if his popularity increases. he wrecks the american economy. by sending in to a recession by going over the cliff. it's terrible policy to do what would happen unless obama yids somewhat in his deman on the higher rates. we will have defense cuts and destroy the military and cause res ig neigh on principle and end us to recession and not solve the entitlement program. we have the worst economy. entitlement out of control and cuts in discretionary spending in defense and high taxes with stalled economy.

is that how he wants to have a second term? he is not running again. popularity numbers are irrelevant. he knows if he goes over the cliff he will have the worst second term in the last 50 years. i think the cards are held equally. i heard him say, he was open to other ways to use revenues. new ideas he called it. there is a compromise out there where rates are not raised at all or perhaps redefine what the rich are, say $1 million or up, the chuck schumer idea and get a compromise. >> chris: that is a bit of optimism from charles. let me ask you, fred, where do you think negotiations stand? >> charles and a.b. are drea dreaming. this is the real barack obama. he wants to raise tax on the wealthy. he doubled down on it. he says he wants to compromise, why do you devote your opening statement to using the same stuff he said in the campaign, advocating this tax on wealthy.

it's horrible if for economy. it's not half of the fiscal cliff anyway. the tax cliff. it's the entire cliff on taxes. taxes would go up like $380 billion. even if you except middle class, 98% from having a tax increase. you have all the other things. social security tax. holidays going to be gone and so on. so the president really wants to do this. the one argument -- he was asked well, look, you didn't agree to it in 2010. why now? he said well, the economy was so weak back in 2010. i couldn't do it. the economy is weaker now. growth has slowed in 2011 and 2012. this is what his second term what he wants to do. i don't think he cares about the economy. he wants to raise taxes on the wealthy. >> chris: well, as charles points out, we have ten seconds, is he willing to go over the cliff to do that? >> yes, i think so. >> chris: have a recession? >> there would probably be one

anyway with the taxes going up. >> chris: we'll leigh it there. again, something to talk about. thank you, panel. stay tuned to find out why you should never ever disrespect barbara walters. [ male announcer ] wouldn't it be cool if you could combine the capability of a pathfinder with the comfort of a sedan and create a next-gen s.u.v. with best-in-class fuel economy of 26 miles per gallon, highway, and best-in-class passenger roominess?

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>> chris: finally tonight, you may have heard that actress local agreed to do errant view with barbara walters but then decided to sit down with jay leno instead. turns out that barbara is not taking it too well. >> lindsey is making a film has made a film for lifetime. even then the producers are a little worried at that time about whether or not she would be able to finish the film. when i saw her, i thought she was in very good shape. we took a little footage. take a look. [squealing tires] [ laughter ]